April 3, 2017
Vedder Price is pleased to announce that Michael J. O’Brien has joined the firm as a Shareholder in the Finance & Transactions (F&T) practice group in the New York office.
“The addition of Michael is a huge benefit to our corporate and M&A practices,” says Michael Nemeroff, President and CEO of Vedder Price. “With over 30 years of experience in corporate law, M&A transactions and much more, Michael will bring another well-known and skilled corporate and M&A attorney to our New York office. I’m delighted that our deep corporate practice continues to attract the top legal talent in the country like Michael.”
Mr. O’Brien focuses his practice on mergers and acquisitions, joint ventures and private equity transactions. He has represented strategic clients, financial institutions and private equity firms in investment transactions for over 30 years.
Mr. O’Brien also counsels companies in general corporate and securities matters, including financing transactions. He has represented creditors and debtors in the corporate aspects of restructuring transactions, including the issuance and exchange of securities and negotiation of new shareholder arrangements.
Prior to joining Vedder Price, Mr. O’Brien was a partner in the M&A, Private Equity, Banking and Financial Services and Healthcare teams at Sidley Austin LLP. He received his J.D. and graduated cum laude from Harvard Law School and earned his A.B. from Columbia College.
February 22, 2017
Vedder Price is pleased to announce that Daniel B. Lange has joined the firm as a Shareholder in the Executive Compensation & Employee Benefits (ECEB) group in the Chicago office.
“We are extremely excited to have Daniel join our ECEB group. He brings a wealth of knowledge with over 15 years of experience and terrific credentials,” says Tom Wilde, chair of Vedder Price’s Labor & Employment group. “He’s a great addition to our team.”
Mr. Lange represents public and private commercial companies, investment funds, ESOP trustees and employees in structuring and implementing executive compensation packages, as well as broad-based equity incentive compensation arrangements and identifying related compliance and reporting requirements. He also counsels buyers, sellers, management and lenders on the benefits and tax issues that arise in corporate transactions and transactions involving company stock held by ESOPs.
Mr. Lange advises clients on the creation and implementation of retirement plans while also helping clients understand and comply with the various tax laws affecting executive and equity compensation. He also has experience in structuring and implementing welfare benefit programs, including severance, health and disability.
Prior to joining Vedder Price, Mr. Lange was a partner in the Pensions, Benefits and Executive Compensation practice at Dentons. He received a J.D. from Washington University School of Law and a B.A. from the Jewish Theological Seminary.
April 21, 2017
The Vedder Price Global Transportation Finance team was honored by Airfinance Journal for its role in two 2016 “Deals of the Year.” Each year, Airfinance Journal recognizes aviation transactions that stand out in terms of innovation, size, timing, pricing and whether the deal creates a new market standard.
Vedder Price was recognized in the following categories:
- Tax Lease Deal of the Year – Vedder Price represented Natixis, as lead arranger and swap provider, and the other finance parties in a Japanese Operating Lease with Call Option (JOLCO) transaction for the financing of 787-9 aircraft on lease to Aeromexico. This transaction was unique as a fixed rate financing for a North American operator. This was Aeromexico’s first financing in the Asia Pacific region, thus allowing the airline to diversify its sources of funding. Shareholders Cameron Gee and Matthew Larvick were the lead attorneys on the matter, supported by Associate Andrew Ceppos.
- Editor’s Deal of the Year – Vedder Price was also recognized for its role in the Labrador Aviation Finance Asset Backed Securitization (ABS). The firm served as counsel to Korea Investment Management Co. and Meritz Securities USA, Inc. in this groundbreaking ABS transaction, which marked the first time equity securities in an aircraft ABS structure were sold into the Korean markets. Attorneys involved in the transaction were Shareholders Geoffrey Kass, Theresa Peyton, Peter Wynacht, Mark Ditto and Associate Daniel Cunix.
With over 60 professionals in Chicago, New York, Washington, DC, London, San Francisco, Los Angeles and Singapore, the Global Transportation Finance team of Vedder Price is one of the largest, most experienced and best recognized transportation finance practices in the world.
Margo Wolf O’Donnell Named “Women of Influence Award Winner” in Best Lawyers Spring Business Edition
April 5, 2017
Margo Wolf O’Donnell, a Shareholder and Chair of the Vedder Price Diversity Committee, was recently named by Best Lawyers as a “Women of Influence Award Winner” in their “Women in the Law” Spring Business Edition. Fifteen women attorneys from across the nation were chosen as award winners, with five women, including Ms. O’Donnell, from Chicago law firms.
Ms. O’Donnell’s interview with Best Lawyers touched on her history in litigation and where her inspiration came from, why diversity and attorney support are so important for firms and companies to develop environments fertile for success, and how she wins business by focusing on the value provided to the client. She notes, “When it came time for me to practice law, I found that I enjoyed litigation because it constantly exposed me to new ideas and businesses; it is still so interesting and gratifying to learn what my clients do and help them achieve their goals.”
In addition to leading Vedder Price’s Diversity Committee, Ms. O’Donnell is an experienced litigator. She also acts as a business adviser to her clients, helping them to anticipate and prevent disputes, and she regularly counsels clients on a variety of employment-related issues. She is a frequent speaker and has been widely quoted by various national media outlets on topics relating to the prevention of litigation and has received numerous accolades for her work. She is also a past President of the Coalition of Women’s Initiatives in Law, a past recipient of the Coalition Leadership Award and has been recognized by Best Lawyers for Commercial Litigation since 2013.
The “Women of Influence” awards are the result of the first-ever collaboration between the Coalition of Women’s Initiatives in Law and Best Lawyers. Coalition members nominated 70 attorneys from firms and companies across the nation based on their achievements and accolades in their specific practice areas, and 15 winners were selected based on factors such as number of nominations, nominator feedback and editorial research.
To read the full interview, please click here.
April 6, 2017
On March 15, 2017, the Office of the Comptroller of the Currency (the “OCC”) published for comment a draft supplement to the OCC’s existing Comptroller’s Licensing Manual providing detail on how the OCC will evaluate national bank charter applications from financial technology (‘FinTech”) companies that engage in the business of banking, other than accepting deposits. In so doing, the OCC has moved one step closer to making its FinTech bank charter a reality. Below we provide a summary of the proposed OCC guidelines for accepting and approving a FinTech charter (the “FinTech Guidelines”).
Who may apply for a special purpose national bank charter?
The OCC has authority to grant charters for national banks and federal savings associations. That authority extends to the granting of charters for special purpose national banks (“SPNB”). SPNBs may limit their activities to fiduciary activities or to any other activities within the business of banking. However, with respect to the SPNB charter for FinTech companies, the OCC states that it will only accept applications from FinTech companies engaged in either (i) paying checks or (ii) lending money.
How will the application be reviewed?
In evaluating an SPNB application, the OCC will be guided by the following principles in evaluating a company, including:
- Operating in a safe and sound manner
- Providing fair access to financial services
- Promoting fair treatment of customers and financial inclusivity
- Ensuring compliance with all applicable laws and regulations
- Fostering healthy competition in the banking marketplace
Step-by-Step Chartering Process Summary
The OCC’s standard process for reviewing and taking action on charter applications would apply to applications from Fintech companies. The proposed FinTech Guidelines provide an outline of the basic procedures for applying for a Fintech charter, note some unique aspects that are different for a FinTech applicant and detail the expectations of the OCC in reviewing any prospective application.
Specifically, all national bank charter applications are reviewed and processed through the OCC’s Licensing Department. Although the traditional national bank charter application involves four distinct stages, the OCC has suggested that the process for seeking a FinTech charter will involve additional stages as described below.
- Initial Inquiry. The OCC has suggested that a FinTech company seeking a special purpose charter make an initial inquiry concerning the charter application through the OCC’s Office of Innovation. The OCC’s Office of Innovation is the primary point of contact within the OCC for all FinTech inquiries, including the chartering process.
- Exploratory Meeting. If the FinTech company wishes to continue discussions after this initial inquiry, the company may request that the OCC schedule an exploratory meeting with the appropriate OCC staff, including the OCC Licensing Division. The relevant points to be addressed at this meeting are (i) the company’s business model, (ii) the FinTech Guidelines, (iii) the OCC’s expectations in reviewing any prospective application and (iv) any questions or comments that the FinTech company has regarding the regulatory environment and process.
- Prefiling Communications. Following the exploratory meeting, a prospective FinTech applicant will be expected to engage with the OCC in formal and informal communications to discuss its proposal, the chartering process and application requirements. During this stage, the OCC will begin to identify aspects of the FinTech company’s proposed charter that present novel or complex issues. These issues will be discussed at one or more prefiling meetings with OCC staff.
- Formal Prefiling Meeting. Before the formal prefiling meeting, the FinTech applicant is expected to provide the OCC with the following: (i) an overview of the FinTech charter proposal, including a discussion of the business plan, the relevant market, novel policy or legal issues identified and any unique aspects of the proposal; (ii) information about the managerial experience and qualifications of senior management and directors; and (iii) a draft business plan. In addition, the OCC expects any FinTech company engaging in lending or providing financial services to customers to demonstrate a commitment to financial inclusion.
- Filing. Upon completion of the prefiling process, a FinTech applicant will submit both (i) its application and (ii) any appropriate Interagency Biographical and Financial Report on all identified insiders. In addition, national bank charter applicants are generally required to publish a notice of their application filing in a newspaper of general circulation. However, the OCC notes that it understands that FinTech applicants may be entirely digital (i.e., lacking a physical office location) and will consider the operations of the company in determining where notice is appropriate.
- Review and Evaluation. The OCC reviews the application and conducts background and field investigations to determine whether to approve the application. In so doing, the OCC is guided by the following principles: (i) senior management and directors are expected to have an appropriate level of skill and experience; (ii) the company must have adequate capital to support the projected volume and type of business; (iii) any business plan must articulate a clear path and timeline to profitability; and (iv) any business plan is expected to appropriately describe the company’s goals, approach, activities and milestones for serving its relevant market and community. In evaluating any charter application, the OCC may identify specific controls or requirements that are necessary for the company’s success and to ensure the OCC’s chartering standards are met.
- Preliminary Approval. The OCC grants preliminary approval that may be subject to certain conditions. This period is often referred to as the “organizational phase.” The applicant may then raise capital and prepare for opening. Prior to opening, the OCC will conduct a preopening examination.
- Final Approval. Thereafter, the OCC determines whether the bank has met the requirements and conditions for opening. If the FinTech company has met those requirements and conditions, the OCC will grant final approval of the charter. Once the FinTech company received its charter, it can begin conducting its business as an SPNB. In addition, as an SPNB, the FinTech company will be subject to ongoing OCC supervision and regulation with periodic assessments and fees.
Supplemental Guidance on Submitting a Business Plan
In addition to the FinTech Guidelines, the OCC will look to the Business Plan Guidelines, Comptroller’s Licensing Manual, in reviewing SPNB applications. The Business Plan Guidelines are separate from and remain unaffected by the FinTech Guidelines. Consequently, it is an additional source of guidance for FinTech applicants.
Pursuant to the Business Plan Guidelines, each applicant is required to submit a detailed business plan, including a description of the following: (i) the business; (ii) marketing plan; (iii) records, systems and controls; (iv) the financial management plan; (v) process for monitoring and revising the plan; (vi) alternative business strategies; and (vii) financial projections. However, the OCC recognizes that FinTech applicants may have structures and business models that are different from traditional, full-service national banks. Thus, in addition to these general requirements, FinTech applicants will be required to consider the following specific elements in any submitted business plan.
- Risk Assessment. A FinTech company will be expected to include a risk assessment that identifies and discusses inherent risks associated with its given business model. While risks may include typical risks such as concentration risk, compliance risk, reputation risk, strategic risk, operational risk and cybersecurity risk, the OCC expects a more detailed discussion concerning regulatory considerations (e.g., Bank Secrecy Act/Anti-Money Laundering, fair lending and consumer protection), and market economic and competitive conditions, including risks associated with individual products and services.
- Records, Systems and Controls. A FinTech company will be expected to describe the company’s record keeping, transaction processing and internal controls that will enable the company to protect consumer data and ensure processing efficiency. Accordingly, the company should address in its business plan its (i) information technology program, (ii) compliance management program, (iii) plan to provide for independent testing of systems and controls and (iv) third-party risk management system.
- Financial Management. In general, FinTech companies will be expected to comply with the minimum leverage and risk-based capital requirements applicable to all national banks. However, the OCC understands that FinTech companies may have significant off-balance-sheet exposures not adequately captured by the capital adequacy framework. The applicant will be expected to provide (i) descriptions of these off-balance-sheet exposures and (ii) propose minimum capital levels the company will adhere to initially (until profitability is reached) that are sufficient to support the company’s business plan.
- Alternative Business Strategy. Depending upon the FinTech applicant’s business model, the OCC may require the applicant to include a discussion of alternative business strategies detailing how the company will manage potential scenarios when expectations differ significantly from the original plan. However, all applicants are expected to discuss (i) realistic contingency plans, (ii) recovery planning and (iii) exit strategies.
- Financial Inclusion Plan (“FIP”). The OCC’s chartering standards require it to consider whether a FinTech company’s business model promotes and provides fair access to financial services and fair treatment of customers. The OCC understands that the nature and scope of the FIP will vary depending on the applicant’s business model and products/service offerings. However, a company will be expected to include in its business plan a description of the company’s knowledge of and plans to serve the community. This description should include (i) proposed goals, (ii) approach, (iii) activities and (iv) milestones.
In an irregular step, the OCC has submitted the FinTech Guidelines to a thirty (30) day public comment period. While changes to the Comptroller’s Licensing Manual are typically made without submission to the public for comment, the OCC seems to be taking a cautious approach to chartering FinTech companies due to the novel issues posed for regulatory review and oversight. With the expiration of this public comment period on April 14, 2017, absent any substantial changes to the FinTech Guidelines, the OCC may begin accepting applications for Fintech charters in the near-term.
While the FinTech applicant can anticipate a thorough vetting by the OCC, there is one bit of regulatory relief worth noting. An applicant for a full service national bank charter must also contend with the FDIC and, if a holding company is contemplated, the Federal Reserve. However, because a FinTech charter will not be authorized to receive deposits, an application for FDIC insurance will not be needed. Similarly, a FinTech charter bank will not be considered a bank for purposes of the Bank Holding Company Act. That is two less regulators to worry about.
To view the full text of the OCC’s FinTech Guidelines, click here.
For more information about the recent OCC announcement, please contact James M. Kane at +1 (312) 609 7533, Daniel C. McKay, II at +1 (312) 609 7762, James W. Morrissey at +1 (312) 609 7717, Jennifer Durham King at +1 (312) 609 7835, Juan M. Arciniegas at +1 (312) 609 7655, Lisa M. Simonetti at +1 (424) 204 7738, Mark C. Svalina at +1 (312) 609 7741 or your Vedder Price attorney.
New Form I-9 Went Into Effect on January 22, 2017
This is a reminder that U.S. Citizenship and Immigration Services (USCIS) released an updated version of Form I-9, Employment Eligibility Verification. The new Form I-9, dated 11/14/2016, became mandatory on January 22, 2017, replacing the version dated March 8, 2013. As you know, pursuant to federal immigration law, employers must maintain a properly completed Form I-9 for all employees hired in the U.S. after November 6, 1986. Employers may access the new Form and its Instructions at: https://www.uscis.gov/sites/default/files/files/form/i-9.pdf. The most important change to the Form is that it can now be completed electronically, which may decrease errors. However, if you use the electronic Form I-9 on the government website, you must still print it out and have it signed by both the employee and employer. The Manual for Employers (M-274) is in the process of being updated, but there are still no changes regarding I-9 Forms for remote workers.
Immigration-Related Executive Orders
On January 27, 2017, President Donald Trump issued an Executive Order that created substantial changes to the United States’ long-standing refugee policy and other certain immigration benefits. It would also suspend the admission of individuals “from” the following countries: Iran, Iraq, Libya, Somalia, Sudan, Syria and Yemen for 120 days. A subsequent communication from the Department of Homeland Security clarified that people who hold lawful permanent resident (“green card”) status will be readmitted to the U.S. even if they are from one of the seven countries. That means that if you employ someone in temporary status (e.g., H-1B, L-1, E-1/E/2, TN or O-1) and they are from the listed countries, they would have trouble reentering the U.S. if they were out of the country for business, vacation, family matters and the like.
Several federal courts have issued rulings to stay the terms of the Executive Order that would have barred the entry of foreign nationals from these countries even with a valid visa or status as a lawful permanent resident. After a district court judge in the Western District of Washington issued a stay, putting a temporary hold on enforcement of this ban, the Court of Appeals for the 9th Circuit upheld the stay, so this Executive Order is not being enforced as of this writing.
We advise clients that have employees who are nationals of the seven affected countries who are on temporary visas to avoid traveling internationally if possible, as another Executive Order may be issued while they are abroad. However, lawful permanent residents from the affected countries should be able to travel abroad and safely return to the United States. They should expect that it may take longer to clear Customs/Immigration when returning to the United States. We will keep you updated with immigration law changes that affect you and your employees.
As always, please feel free to contact Gabrielle M. Buckley at +1 (312) 609 7626, your Vedder Price attorney or a member of our Immigration practice group with any questions you may have regarding these issues or any other immigration issues.
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May 11, 2017
Financial services professionals and in-house counsel are invited to the 29th Annual Banking Law Update, a complimentary half-day conference presented by the Vedder Price Financial Institutions group.
Norman R. Bobins
Chairman of the Board, The PrivateBank
The Honorable Randy Hultgren
U.S. Representative for Illinois' 14th Congressional District and
Member of the House Committee on Financial Services
A full agenda will be announced in the coming weeks.
May 12, 2017
Please join us at one of the following complimentary, half-day sessions designed for in-house counsel and human resource professionals, led by the attorneys of Vedder Price.
What can you ask about your employees’ personal social media presence?
What is the latest on confidentiality and privacy at the workplace?
Do your employment contracts impermissibly chill federal whistleblower rights?
Do the Illinois, Chicago and Cook County sick leave ordinances apply to you and what do they require?
Do you need to change your vacation policy to comply with new sick leave laws?
What actions have been taken (or promised) by the new administration that impact employers?
What recent cases should employers know about?
Status of Affordable Care Act/Benefits Update
Peering Ahead to the First Full Year of a Trump NLRB: How Much Change Can Employers Really Expect?
Business Immigration Law Update - Compliance and Work Authorization
Class Action and Wage/Hour Update
Keynote Address and Panel Discussion: The Disruptive Employee
Keynote Address: When Disruptive Becomes Dangerous
Marisa R. Randazzo, Ph.D.
SIGMA Threat Management Associates
Panel Discussion: Managing the Disruptive Employee
Having the right policies in place
Navigating ADA and FMLA compliance
Mitigating workplace violence risk
Protecting employee privacy
Does OSHA matter?
Will a union help or hinder?
NEW THIS YEAR! Join us over lunch for a breakout discussion on California Employment Law Issues -- Key Differences to Be Aware Of.
CLE & HRCI Credit
Vedder Price is an accredited CLE provider in California, Illinois and New York; and, when possible, a sponsor in Virginia.
The use of this seal confirms that this activity has met HR Certification Institute's® (HRCI®) criteria for recertification credit pre-approval.
To learn more about our 2017 Vedder Works events taking place in New York, Washington, DC, California and London, please click here.